BIM24000 - Meaning of trade: mutual trading and members clubs: contents

Mutual trading is an important concept because a mutual trader is not liable to tax on any profits arising from their mutual trade. This is as a result of the principle that 'a person cannot trade with themselves'. This section of the guidance discusses the essential requirements for a trade to be mutual and the case law from which those requirements are derived. The section also discusses a number of matters under the broad heading of mutual trading that are not mutual trading as such but which frequently involve a mutual association, including the treatment of members’ clubs and certain co-operatives and associations.

A full list of the contents of the guidance on mutual trading is shown below. The guidance is subdivided into sections, the opening page of each section being in bold in the list below. Please click on the page number alongside to go direct to each section.


BIM24001 Overview
BIM24005 Layout of guidance
BIM24010 Income derived solely from members’ contributions and subscriptions
BIM24015 Introduction: basic considerations
BIM24020 Introduction: characteristics
BIM24025 Introduction: origins of the concept
BIM24027 Introduction: early attempt at taxing surplus
BIM24030 Introduction: founding principles
BIM24035 Introduction: two early mutual insurance cases
BIM24040 Introduction: further early mutual insurance cases
BIM24045 Introduction: essential that the activity is a trade
BIM24100 Essential requirements
BIM24105 Essential requirements: contributors to and participators in a surplus must be identical
BIM24110 Essential requirements: surplus must go back to contributors
BIM24115 Essential requirements: return of surplus contributions
BIM24120 Essential requirements: members must control the common fund
BIM24150 Non-mutual insurance trading activities
BIM24155 Non-mutual insurance trading activities: corporation water works
BIM24160 Non-mutual insurance trading activities: corn trading association
BIM24200 Members’ clubs: layout of guidance
BIM24205 Members' clubs: introduction
BIM24210 Members’ clubs: distinction between proprietary and members’ clubs
BIM24215 Members' clubs: Tax Bulletin article
BIM24220 Members' clubs: classes of club membership
BIM24225 Members’ clubs: temporary membership
BIM24230 Members’ clubs: Tax Bulletin article on temporary membership
BIM24235 Members’ clubs: voting rights
BIM24240 Members' clubs: different forms of club
BIM24245 Members' clubs: incorporated as industrial and provident societies
BIM24250 Members' clubs: incorporated as limited company
BIM24255 Members' clubs: incorporated as limited company: conditions to be satisfied for members’ club treatment
BIM24260 Members' clubs: incorporated as limited company: shareholder inequality
BIM24300 Members' clubs: guidance for customers
BIM24305 Members' clubs: interest paid or received
BIM24315 Members' clubs: commission income
BIM24320 Members' clubs: community associations
BIM24325 Community amateur sports clubs
BIM24330 Community amateur sports clubs: relief available on a claim
BIM24335 Community amateur sports clubs: conditions for registration
BIM24345 Cricket clubs
BIM24350 Golf clubs: introduction
BIM24360 Golf clubs: computation of profit
BIM24365 Rugby clubs: introduction
BIM24370 Rugby clubs: Rugby Football Union (RFU) booklet
BIM24400 Incorporation
BIM24405 Incorporation: difficulties associated with having shareholders
BIM24410 Incorporation: a company trading only with its members may be non-mutual
BIM24450 Allowable expenditure
BIM24455 Allowable expenditure: trades that are partly non-mutual
BIM24460 Allowable expenditure: apportionment of mixed expenditure
BIM24465 Allowable expenditure: judicial guidance on apportionment
BIM24470 Allowable expenditure: members golf clubs: is intention relevant?
BIM24475 Allowable expenditure: the ‘Peterhead’ principle
BIM24480 Allocation of income: introduction and layout of guidance
BIM24485 Allocation of income: nature of activities
BIM24490 Allocation of income: income from contributors
BIM24495 Allocation of income: income from non-contributors
BIM24500 Allocation of income: mixed income
BIM24505 Allocation of income: sundry income
BIM24550 Distributions: introduction and layout of guidance
BIM24555 Distributions: the basic approach
BIM24560 Distributions: dividends from a co-operative etc society
BIM24565 Distributions: S1070 Corporation Tax Act 2010
BIM24600 Distributions: on winding-up
BIM24605 Distributions on winding-up: taxable on first principles or statute
BIM24615 Distributions on winding-up: statute: what is taxed?
BIM24650 Mutual associations: specific activities: introduction
BIM24655 Mutual associations: specific activities: NHS doctors' co-operatives
BIM24660 Mutual associations: specific activities: NHS doctors' co-operatives: essential pre-requisite
BIM24665 Mutual associations: specific activities: NHS doctors' co-operatives: essential pre-requisite: does the trade meet the criteria?
BIM24670 Mutual associations: specific activities: NHS doctors’ co-operatives: varieties
BIM24675 Mutual associations: specific activities: NHS doctors’ co-operatives: National Association of GP co-operatives
BIM24680 Mutual associations: specific activities: mutual health insurers: introduction and layout of guidance
BIM24685 Mutual associations: specific activities: mutual health insurers: background
BIM24690 Mutual associations: specific activities: mutual health insurers: two interrelated questions
BIM24695 Mutual associations: specific activities: mutual health insurers: are they trading?
BIM24700 Mutual associations: specific activities: mutual health insurers: is the trade mutual?
BIM24705 Mutual associations: specific activities: agricultural co-operatives: introduction and layout of guidance
BIM24710 Mutual associations: specific activities: agricultural co-operatives: background
BIM24715 Mutual associations: specific activities: agricultural co-operatives: model constitution
BIM24720 Mutual associations: specific activities: agricultural co-operatives: three points to watch
BIM24725 Mutual associations: specific activities: agricultural co-operatives: financing
BIM24730 Mutual associations: specific activities: agricultural co-operatives: taxation of
BIM24735 Mutual associations: specific activities: agricultural co-operatives: not conducting a mutual trade
BIM24740 Mutual associations: specific activities: agricultural co-operatives: members taxation
BIM24745 Mutual associations: specific activities: agricultural co-operatives: futures dealing
BIM24750 Mutual associations: specific activities: Chambers of Commerce: introduction
BIM24755 Mutual associations: specific activities: Chambers of Commerce: trading?
BIM24760 Mutual associations: specific activities: Chambers of Commerce: a mutual trade?
BIM24765 Mutual associations: specific activities: Hunt point to point meetings: introduction and layout of guidance
BIM24775 Mutual associations: specific activities: Hunt point-to-point meetings: trading?
BIM24780 Mutual associations: specific activities: Hunt point-to-point meetings: dealings with members
BIM24782 Mutual associations: specific activities: property management companies
BIM24784 Mutual associations: specific activities: bulk buying groups: introduction
BIM24786 Mutual associations: specific activities: bulk buying groups: basic principles
BIM24788 Mutual associations: specific activities: bulk buying groups: two relationships
BIM24792 Mutual associations: specific activities: voluntary organisations and charities: fund-raising events: introduction and layout of guidance
BIM24794 Mutual associations: specific activities: voluntary organisations and charities: tax exemption
BIM24795 Mutual associations: specific activities: voluntary organisations and charities: conditions for exemption
BIM24796 Mutual associations: specific activities: voluntary organisations and charities: donations etc. not chargeable
BIM24797 Mutual associations: specific activities: voluntary organisations and charities: reference to Specialist PT Charities
BIM24800 Mutual associations: specific activities: trade protection associations: introduction
BIM24805 Mutual associations: specific activities: trade protection associations: HMRC arrangement
BIM24810 Mutual associations: specific activities: trade protection associations: procedural points when adopting HMRC arrangement
BIM24815 Mutual associations: specific activities: trade protection associations: benefits to members of adopting HMRC arrangement
BIM24820 Mutual associations: specific activities: trade protection associations: text of HMRC arrangement
BIM24850 Mutual associations: specific activities: marketing boards
BIM24950 Deductibility of payment made by contributor to a mutual trader
BIM24995 Tax cases referred to in guidance